K Ltd reported beginning and ending balances in the allowance for doubtful debts account of $723 000 and $904 000 respectively.It also reported that write-offs of bad debts amounted to $648 000.Assuming that no previously written-off accounts had been collected,what amount did K Ltd record as bad debt expense for the period?

Question

Quizplus · Accepted Answer

Bad debt expense for the period can be calculated by using the formula: 
Beginning balance in allowance for doubtful debts + Bad debt expense − Write-offs of bad debts = Ending balance in allowance for doubtful debts

Substituting the given values in the formula, we get:
$723,000 + Bad debt expense − $648,000 = $904,000

Solving for Bad debt expense, we get:
Bad debt expense = $904,000 − $723,000 + $648,000
Bad debt expense = $829,000

Therefore, the correct answer is option C, $829,000.

K Ltd Reported Beginning and Ending Balances in the Allowance